Pakistan established free economic zones with different countries to promote trade and to flourish the related industries. Heavy custom duties /tariffs on imports are restricting the inflow of goods. The Federal Board of Revenue (FBR) has revised the custom duty on imports of a few products from the South Asian Association Cooperation (SAARC) member countries. Eight countries are under the SAARC, i.e., Bhutan, Bangladesh, India, Nepal, Maldives, Sri Lanka, Afghanistan, and Pakistan. Imports in Pakistan have a lot of duty burdens relating to these countries, which are relaxed under the South Asia Free Trade Area (SAFTA).
Pakistan has adopted the policy of the Free Trade Agreement (FTA) between Sri Lanka and Pakistan. Preferential Trade Agreement (PTA) on import from Iran, Malaysia, Indonesia, and Turkey from 1st July 2022. FBR has amended Statutory Regulatory Orders (SROs) like SRO No. 1274(I)/2006 and released new SRO 1246/(I)/2022 on 3rd July 2022 due to excess duties. List of products that are exempted or have concessions under the heading and sub-heading of the “ First Schedules to Customs” are grains, fruits, meat, edible oil, Textile, cement, chemical, and metals (copper, zinc, aluminum, & other metal of steel industry). Condition is products are lying under the “Rule of Determination of Origin of Goods under the Agreement on SAFTA” and the “Certification Procedures from SAFTA.” FBR has amended the SRO 280(I)/2014 and issued SRO 1248(I)/2022.
Many products are lying in the trade from ECO member countries. FBR has revised SRO 558(I)/2004 and issued SRO1250(I)/2022 to exempt the products from import duty under the 90% duty imposition category for the two ECO member countries, Turkey and Iran. But the rule of origin is applicable as notified by the Ministry of Commerce. Pakistan also announced FTA with Indonesia and Malaysia.
Pakistan has FTA with China on several goods exempted from customs duty or with imports at concessionary custom rates. Under the SRO 1181(I)/2022 issued after amendments in SRO 1640(I)/2019. Pakistan is trying to have a bilateral trade in the currency of Pakistan (PKR) or China (RMB). Prime Minister ordered to State Bank of Pakistan to have a meeting with Chinese Banks. If this happens, the Pakistani rupee will get help to stabilize against the dollar.
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